Shortage of finished goods and material - irregular availment of CENVAT credit - Held that: - appellant has failed to produce the closing stock for physical verification. I am not convinced by the explanation given by the appellant for short recovery of scrap. Therefore, I do not find any infirmity in the impugned order upholding the Order-in-Original by the Commissioner (Appeals) - demands under the provisions of CCR 2004 read with proviso to Section 11A(1) of the CEA along with demand of inter .....

. Hence, the issues have been verified and investigated by the preventive unit of the Commissionerate. On investigation it is found that closing stock of the materials in stock register is not available for physical verification; that the appellant has availed simultaneous benefit of cenvat credit on capital goods and also claimed depreciation under Income Tax Act on the value which included cenvat amount; that they have cleared the said capital goods without raising invoice and paying the duty .....

l goods and services, demanding central excise duty on the physical shortage of finished goods and demanding central excise duty not paid along with interest and also with a proposal to impose penalty. The original authority after following the due process of law vide Order-in-Original dated 16.03.2012 confirmed the demands under the provisions of Cenvat Credit Rules 2004 read with proviso to Section 11A(1) of the Central Excise Act along with demand of interest and also imposed equal penalty un .....

,000/- (Rupees Fifty Thousand only). Hence the present appeals. 3. Heard both the parties and perused the records. 4. Learned counsel for the appellant submitted that the impugned order is not sustainable in law as the same has been passed without considering the peculiar facts of the case and the documents on record. He further submitted that the wrecked ship was in sea and warehousing bill of entry was filed on estimated quantity by paying Customs duty and when it was converted into scrap then .....

sustainable. He also submitted that the appellants have paid the irregular cenvat credit availed on hydraulic mobile crane and hence the penalty imposed for the said violation is not tenable as they had no intention to evade duty. He also submitted that the utilization of credit of education cess and higher education cess for payment of excise duty is a bona fide procedural mistake and hence the penalty imposed for the same is not tenable. He also submitted that the place of removal for the pur .....

s filed ER-1 returns regularly and according to the appellant only the stock in May 2009 was 227.86 MT and without any valid reasons and without any explanation, the opening balance in June was taken as zero. If the salvage quantity was less and when the appellants were clearing these scrap from time to time it is difficult to understand how appellants came with the closing balance of 227.86 MT instead of showing it as zero in May. He also submits that appellants were aware that the ship was sub .....

ejected the appeal and accepted the findings of the original authority which has analysed the entire evidence on record. Further as regards the eligibility for credit of service tax on outward freight, the learned Commissioner (Appeals) has discussed the same in para 7 which is reproduced herein: 7. As regards eligibility for credit of service tax, appellant have produced the copies of invoices raised for clearance of waste and scrap from their works at Karwar. All these invoices contain 'NO .....